Dench, who is nominated for best actress for her touching role in Philomena, is working in India on The Best Exotic Marigold Hotel 2 and cannot make the trip for Sunday evening's telecast, according to Fox Searchlight, the studio behind the new sequel.
Dench, 79, who also missed the Golden Globe awards, had previously said she hoped to attend Sunday night's big awards show – where she is certainly no stranger.
Dame Judi has been nominated for an Oscar seven times, winning in 1999 for Best Supporting Actress in Shakespeare in Love.
In Philomena, Dench portrays real-life nurse Philomena Lee, who set off on a long journey to find her son after being forced to give him up for adoption when she was an unwed teen.
The 86th annual Academy Awards, hosted by Ellen DeGeneres, wlll air Sunday, March 2, at 8:30 p.m. ET on ABC.